The Impact of Microfinance on Community Welfare: A Bibliometric Analysis and Systematic Literature Review (SLR)

Over the years, microfinance programs have been the major strategy of many developing countries to improve people’s welfare and reduce poverty. Yet several studies on the welfare impacts of microfinance result in contradictory conclusions. While some studies support the mainstream view that microfinance improves the welfare of the unbankable poor, others criticize its limited effect on business development and weak impact measurement methods. This study analyzes 409 articles to bridge the empirical gaps between mainstream and critical views of microfinance impacts on society through synthesizing major themes in existing research and their interconnections and provides recommendations for future research. Using bibliometric and systematic literature review (SLR) approaches, this study found five clusters of empirical research on microfinance impacts, including entrepreneurship and poverty alleviation; self-help groups and women empowerment; financial inclusion; household income; and community welfare. The study also suggests that microfinance programs have positive impacts on welfare across countries. However, future research needs to more deeply focus on the impact of microfinance programs on agricultural finance, specifically financial efficiency, and social efficiency.